GRJ0018
Environmental Audit Committee for the inquiry on Green jobs
Submission by Rolls-Royce plc
Rolls-Royce pioneers cutting-edge technologies that deliver clean, safe and competitive solutions to meet our planet’s vital power needs. We are a UK-based company with customers in more than 150 countries. We employ over 20,000 people in the UK and invested over £1.46 billion on research and development globally in 2019. Our business is focused on three core areas in Civil Aerospace, Defence and Power Systems and we lead the UK Small Modular Reactor (UK SMR) Consortium in the Nuclear sector. Rolls-Royce is committed to playing a leading role in enabling the sectors in which we operate to reach net zero carbon by 2050 through the development of new products and technologies, including aviation, shipping, rail, and power generation.
2. Does the UK workforce have the skills and capacity needed to deliver the green jobs required to meet our net zero target and other environmental ambitions (including in the 25-year environment plan)?
Nuclear Energy supports thousands of jobs across the UK today. Nuclear can play an important role in reducing the UK’s greenhouse gas emissions from energy production, as noted in the Government’s Energy White Paper and 10 point green industrial revolution plan.
The UK retains important capabilities in both manufacturing and the services industries that could be expanded and applied to a UK Small Modular Reactor (SMR) fleet through its lifetime. As such it is important to recognise that specific regional opportunities will arise due to factory and power station site locations in the UK.
Due to the nuclear decommissioning legacy and geographical spread of ageing nuclear reactors, today’s nuclear workforce is dispersed across sites around the UK, with a heavy concentration in the Northwest of England. In addition, national heavy forgings capability is ageing and is supported by a small range of opportunities that limit the ability to invest in capability and capacity.
The creation of a domestic UK SMR by the UK SMR Consortium will contribute significantly to climate change actions, and also stimulate significant UK industrial activity and regional economic growth, including jobs.
The UK nuclear industry has a strong track record of working with Government, educational establishments and skills bodies to ensure a pathway for creating and drawing talent into the industry. With continued engagement and support from Government, particularly around STEM subjects, the forward growth of the UK nuclear industry can act as a catalyst for providing highly skilled opportunities to an ever more diverse range of people.
In order to achieve the UK’s legally binding net zero targets, the Government need to ensure continued support to domestic programmes. For example, the UK SMR programme requires a range of Government interventions around sites, development, demand and funding to ensure continued investor and supply chain confidence and an accelerated deployment of the UK SMR technology.
The UK SMR consortium is a member of the board of the Nuclear Skills Strategy Group (NSSG) that coordinates data on workforce requirements across the new build programmes. Although this activity will provide evidence regarding the skills and capacity required, Government interventions are needed. This will provide a clear and strong demand signal and confidence to the public and private sectors to make strategic decisions around investment in training and apprenticeships. As a result, education providers will be able to plan and build roadmaps to capture where capacity and capability is needed. Confidence to invest in the supply chain will drive forward an accelerated fleet deployment programme of UK SMR technology and boost the UK economy with domestic technology focused on using the UK supply chain.
4. What measures should the Government take to ensure that its proposals to meet environmental targets do not by default lead to jobs in affected industries being exported?
Job security in the UK nuclear skills supply chain is particularly important due to the ageing civil nuclear industry. All the existing generating nuclear power plants in the UK are due to come offline by 2030, apart from Sizewell B. The UK SMR is a domestic solution with control of supply chain decisions and therefore a strong domestic base for green job creation/retention from manufacture of components through to site operation. The significant global export market opportunity for UK SMR technology provides additional opportunities to secure and expand upon the initial UK green jobs in the supply chain beyond UK deployment.
Confidence and visibility of a fleet of 10 UK SMR units would unlock re-investment in currently limited supply chain facilities, for example forging which support both civil and defence programmes and nuclear fuel manufacturing. A UK SMR fleet deployment could secure these national assets and skilled workers for the foreseeable future and allow re-investment to expand to service forward SMR exports.
The UK has world leading R&D capability in the domain of nuclear energy. Accelerated SMR fleet deployment would provide significant and expansive opportunities for universities, research centres and the private sector to develop globally relevant critical capabilities for the future SMR fleet.
5. What risks are there to meeting the Government’s ambitions for green job creation in both the public and private sectors? What should the Government do to create the conditions to ensure its commitments are met by both sectors?
It is critical that there is a clear delivery plan for green industries and green jobs that ensures there is a coherent demand signal that both public and private sectors can work and deliver to. There needs to be a clear understanding of the nature of the job opportunities in the new green jobs and where and how transferable skills from existing areas could be applied, or where training needs to start now. The government’s ambitions require it to ensure delivery of:
7. How can the UK ensure jobs are created in areas most impacted by the transition to a low-carbon economy?
The UK SMR could create thousands of jobs in regions with a pedigree of the manufacture of steel components, modular systems and civil engineered modules. The midlands, the North of England and North Wales host a significant percentage of nuclear energy legacy jobs and nuclear skilled individuals, as well as apprenticeships and college qualifications which were set up to support the new build projects ear marked for these regions.
The UK SMR programme could create over 40,000 jobs between 2020 and 2035. At least 20,000 of these jobs would persist for around 20 years as the UK and international fleet of UK SMR is manufactured and deployed. The remaining 20,000 jobs would persist in the UK for much longer as they relate to the operations of the UK SMR fleet which has a projected lifespan of at least 60 years.
9. What impact can green jobs have on the wider UK economy?
A measured transition to a UK economy based on green jobs is a sensible, risk balanced, approach to the long-term sustainability and competitiveness of the UK economy on the global stage.
The UK SMR programme can play a role in supporting this transition. It is anticipated that around 6 or more regional factories (or factory clusters) will be required to fulfil the demand for UK SMR within the UK alone, each creating around 6,000 jobs. These can enhance established capabilities in regions of the North and North West which have extensive nuclear industry and heavy manufacturing experience. As such, deployment of UK SMR can act as a vector for the UK Government’s ‘levelling Up’ agenda, bringing sustained, low-carbon and skilled job opportunities to regions across the North and North-West of England, North Wales and beyond.
Beyond this SMR programme there is embryonic effort to develop the next generation of AMR and Fusion Power Stations (UK STEP). Much of the technology, learning and supply chain capability regenerated through an acceleration of the UK SMR programme will be utilised on these future programmes as they mature in the 2030s. Investing in this capability now for UK SMR ensures an opportunity to invest in the future of UK clean energy.
10. What contribution can green jobs make to the UK’s economic recovery from Covid-19?
The UK Government can substantially bring forward early economic growth, investment and job creation to create a new world leading industry that will generate revenues through export sales.
By adopting a series of parallel activities for SMR deployment (site development, planning, factory and supply chain investments etc.) that would otherwise be conducted in series, the deployment timelines benefit significantly (reducing overall schedule to deployment by up to 28 months) and near-term economic stimulus can be created in the coming years (2021-2024).
In seizing this opportunity, Government will be enabled to rebalance the economy and drive much needed investment into the North of England, North Wales and similar areas where the public will look to Government to stimulate change and economic investment.